Life-cycle cost and total cost of ownership
Compare the cost of acquiring, operating, maintaining and eventually replacing or retiring an option.
Reference · Guide · Foundation
Compare cash flows and funding
Use consistent currency, timing and price assumptions.
Understand
Currency exposure
Identify how cash flows in different currencies change a project’s funding needs.
Reference · Guide · Foundation
Net present value and IRR
Judge an investment in today's money: discount each year's cash flow, add them up, and find the rate that gives zero.
Model · Study sheet · Foundation
Payback period
Show how long the money is at risk: the time until the cash coming back equals the cash put in.
Model · Study sheet · Foundation
Calculate
Benefit-cost ratio and net return
Compare present-value benefits and costs on one consistent boundary.
Tool · Calculator + guide · Applied
Break-even volume
Find how much output is needed to cover fixed cost.
Tool · Calculator + guide · Applied
Cash-flow funding gap
Find the worst cumulative shortfall in a time-phased cash plan.
Tool · Calculator + guide · Applied
Present and future value
Put a single cash amount on a common time basis.
Tool · Calculator + guide · Applied
Internal rate of return
Find the break-even discount rate for a conventional investment cash-flow sequence.
Tool · Calculator + guide · Applied
Level-payment annuity
Value an equal payment at the end of each period.
Tool · Calculator + guide · Applied
Nominal to real rate
Align a nominal rate with cash flows measured at constant prices.
Tool · Calculator + guide · Applied
Simple and discounted payback
Estimate when positive receipts recover the initial outlay.
Tool · Calculator + guide · Applied
Straight-line depreciation
Separate a simple accounting charge from cash spending.
Tool · Calculator + guide · Applied
Weighted average cost of capital
Combine equity and after-tax debt costs using financing weights.
Tool · Calculator + guide · Advanced